UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(Mark One)
[x] Quarterly Report under Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarter ended January 31, 1998
[ ] Transition report under Section 13 or 15(d) of the
Exchange Act.
For the transition period from _____to _____
Commission file number 0-5378
GEORGE RISK INDUSTRIES, INC.
(Exact name of small business issuer as
specified in its charter)
Colorado 84-0524756
(State or other jurisdiction (IRS employers
of incorporation or organization) identification No.)
802 South Elm, Kimball, NE 69145
(Address of principal executive offices)
(308)-235-4645
(Issuer's telephone number)
n/a
(Former name, address and fiscal year, if changed since
last report)
Check whether the issuer (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during
the past 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90
days.
Yes [x] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the
Exchange Act after the distribution of securities under a
plan confirmed by a court.
Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the
issuer's classes of common equity, as of the latest
practicable date: 6,067,343
<PAGE>
PART I. FINANCIAL INFORMATION
<PAGE>
GEORGE RISK INDUSTRIES, INC.
Balance Sheet
January 31, 1998
[CAPTION]
[S] [C]
ASSETS
Current Assets
Cash $ 831,000
Marketable securities 4,366,000
Accounts receivable:
Trade, net of $50,000 doubtful
account allowance 1,411,000
Notes Receivable 65,000
Inventories (Note 1) 1,580,000
Prepaid expenses 42,000
___________
Total current assets 8,295,000
Property And Equipment, Net, At Cost 680,000
Other Assets 88,000
___________
TOTAL ASSETS $ 9,063,000
[CAPTION]
LIABILITIES AND STOCKHOLDERS EQUITY
[S] [C]
Current Liabilities
Accounts payable, trade $ 117,000
Notes payable, current portion 46,000
Accrued expenses 427,000
Deferred current taxes (94,000)
___________
Total current liabilities 496,000
Long term Liabilities
Notes payable, FKI, Inc. 174,000
Deferred Income Taxes 34,000
___________
Total long term liabilities 208,000
Stockholders Equity
Convertible preferred stock 257,000
Common stock, Class A 850,000
Additional paid-in capital 1,674,000
Retained earnings 6,170,000
Less cost of treasury stock (592,000)
___________
Total stockholders equity 8,359,000
___________
TOTAL LIABILITIES AND STOCKHOLDERS EQUITY $ 9,063,000
[FN]
See Accompanying Notes to Financial Statements
<PAGE>
<TABLE>
GEORGE RISK INDUSTRIES INC.
STATEMENTS OF INCOME
(unaudited)
<CAPTION>
for three months for nine months
ended ended
January 31 January 31
1998 1997 1998 1997
_______________________ _______________________
<S> <C> <C> <C> <C>
Net sales $2,817,000 $2,525,000 $8,377,000 $8,177,000
Less cost of
goods sold 1,455,000 1,316,000 4,480,000 4,342,000
_______________________ ________________________
Gross profit $1,362,000 $1,209,000 $3,897,000 $3,835,000
Operating expenses
G&A 155,000 148,000 457,000 427,000
Sales 526,000 540,000 1,568,000 1,586,000
Engineering 19,000 4,000 62,000 8,000
_______________________ ________________________
$ 700,000 $ 692,000 $2,087,000 $2,021,000
Income from
operations 662,000 517,000 1,810,000 1,814,000
Other income
(expenses)
Interest income 57,000 52,000 184,000 147,000
Interest expense (6,000) (8,000) (20,000) (25,000)
Other income 16,000 (22,000) 68,000 (22,000)
_______________________ _________________________
$ 67,000 $ 22,000 $ 232,000 $ 100,000
Income before prov-
ision for income
tax $ 729,000 $ 539,000 $2,042,000 $1,914,000
Provision for income
tax
Current expense 211,000 119,000 783,000 696,000
_______________________ _________________________
Net Income $ 518,000 $ 420,000 $1,259,000 $1,218,000
Net income per
common share $ .09 $ .07 $ .21 $ .20
Weighted average
number of common
shares out-
standing 6,080,676 6,061,698 6,085,121 6,061,698
<FN>
See Accompanying Notes To Financial Statements
</TABLE>
<PAGE>
GEORGE RISK INDUSTRIES, INC
Statements of Cash Flows
For The Nine Months Ended January 31,
[CAPTION] 1998 1997
___________________________
[S] [C] [C]
Cash Flow From Operating
Activities:
Net income $1,259,000 $1,218,000
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation 92,000 85,000
Changes in assets
and liabilities:
(Increase) decrease
in:
Accounts receivable (136,000) 66,000
Note Receivable 1,000
Inventories 97,000 (111,000)
Prepaid expenses 26,000 42,000
Other assets (44,000)
Increase (decrease)
in:
Accounts payable (79,000) 101,000
Accrued expenses 61,000 53,000
Notes payable (34,000) (56,000)
Income tax payable 74,000 87,000
Net cash provided by (used in) _________ __________
operating activities 1,316,000 1,486,000
Cash Flows From Investing
Activities:
(Purchase) sale of property
and equipment (92,000) (189,000)
(Purchase) sale of
marketable securities (1,010,000) (1,038,000)
Net cash provided by (used in) __________ __________
investing activities (1,102,000) (1,227,000)
Cash Flows From Financing
Activities:
(Purchase) of treasury stock (36,000)
Net cash provided by (used in) __________ __________
financing activities (36,000)
Net increase (decrease) in
cash $ 178,000 $ 259,000
Cash at beginning
of period $ 653,000 $ 907,000
Cash at end of period $ 831,000 $1,166,000
<PAGE>
GEORGE RISK INDUSTRIES, INC
NOTES TO FINANCIAL STATEMENTS
January 31, 1998
Note 1. Inventories
At January 31, 1998, and October 31, 1997, respectively,
inventories consisted of the following:
Raw materials $ 1,124,000 $ 977,000
Work in process 249,000 203,000
Finished goods 253,000 208,000
___________ ___________
1,626,000 1,388,000
___________ ___________
Less allowance for obsolete
inventory <46,000> <46,000>
___________ ___________
Totals $ 1,580,000 $ 1,342,000
<PAGE>
GEORGE RISK INDUSTRIES, INC
Part I. FINANCIAL INFORMATION
Item 2. Management Discussion and Analysis of
Financial Condition and Results of
Operations.
<PAGE>
MANAGEMENT DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with
the attached condensed consolidated financial statements, and
with the Company's audited financial statements and discussion
for the fiscal year ended April 30, 1997.
Net cash increased $176,000 during the three months ended
January 31, 1998 and increased $178,000 for the nine months
ended January 31, 1998. This is compared to a decrease of
$123,000 for the three months ended January 31, 1997 and a
$259,000 increase for the nine months ended January 31, 1997.
Accounts receivable increased $136,000 for the current nine
months as compared to a $66,000 decrease for the corre-
sponding nine months last year. Accounts receivable collections
averaged $966,000 per month for the quarter ended January 31,
1998 compared to $886,000 per month for the quarter ended
January 31, 1997. Other assets increased $44,000 for the nine
months ended January 31, 1998. Included are dies and molds
that are being made in house and at the time of completion
will be capitalized. Net cash used in investing activities
decreased 11% during the current nine months as compared to
the corresponding nine months ended January 31, 1997.
Property and equipment purchases were down from $189,000 for
the nine months ended January 31, 1997 to $92,000 for the
nine months ended January 31, 1998. The Company purchased
20,000 shares of it's common stock to be held in treasury
during the current quarter. This purchase resulted in
$36,000 being used in financing activities for both the three
and nine months ended January 31, 1998.
<PAGE>
Working capital at January 31, 1998 was $7,799,000 as compared
to $6,263,000 at January 31, 1997. The current ratio was 16.72
at January 31, 1998 and 9.42 at January 31, 1997. The acid
test ratio was 13.45 at January 31, 1998 and 7.05 at January
31, 1997.
Net sales were $2,817,000 for the quarter ended January 31,1998,
a 12% increase over the corresponding quarter last year when
net sales totalled $2,525,000. For the current nine months
net sales increased $200,000 to $8,377,000 as compared to
$8,177,000 for the nine months ended January 31, 1997.
Operating expenses were 25% of net sales for the quarter
ended January 31, 1998 and were 27% of net sales for the
same quarter last year. For the nine months ended January
31, 1998 as well as January 31, 1997, operating expenses were
25% of net sales. Engineering expenses increased from $8000
for the nine months last year to $62,000 for the current
nine months. This substantial increase is due almost ex-
clusively to increased wages and other costs relating to
the hiring of an Engineer and four technicians and support
people over the last several months. Management feels that
the Engineering department is now adequately staffed and will
be instrumental in the Company's continuing success.
Cost of goods sold remained at 53% of gross sales for the nine
months ended January 31, 1998, the same as the corresponding
period last year. Management continues to closely monitor
expenses in an effort to increase profits.
Interest income totalled $57,000 for the quarter ended
January 31, 1998 and $52,000 for the quarter ended January
31, 1997. Total other income increased $45,000 during the
current quarter to $67,000 as compared to $22,000 for the
quarter ended January 31, 1997. For the nine months ended
January 31, 1998, other income totalled $232,000 as compared
to $100,000 for the nine months ended January 31, 1997.
Included in this other income are insurance payments for
roof repairs that will be completed in the spring.
<PAGE>
Net income increased 23% to $518,000 during the current quarter
as compared to $420,000 for the corresponding quarter last year.
This resulted in a 29% increase in earnings per share for the
quarter ended January 31, 1998 over the same quarter last year.
Earnings per share for the current quarter were .09 and .07 for
the quarter ended January 31, 1997. This brings the earnings
per share to .21 for the nine months ended January 31, 1998 as
compared to .20 for the nine months ended January 31, 1997.
Management approved and implemented a 401(K) retirement plan
effective January 1, 1998. The Company will make a matching
contribution of 1% of the participant's elective deferral up to
4% of his annual compensation. Presently, 80% of the total
eligible employees have elected to participate in the plan.
The projected cost for the Company for this initial plan year
is $25,000.
Management has approved the purchase of an injection molding
machine with an estimated cost of $45,000. It will replace
an existing machine and will increase productivity as well as
improve the quality of molded parts.
Management is currently evaluating computer system upgrade
options that will address the year 2000 compliancy issue that
our current software does not provide for. A decision will be
made in the coming months after all options and costs have
been evaluated.
The Company continues to research new markets and will be
aggressive in the area of new product development. New products
to be released soon include a water sensor with a relay module
and a temperature sensor switch. Management is excited about
the diverse product potential these applications have for
residential and commercial automation and control. The Company
is also looking to expand its' proximity switch line and will be
attending different trade shows to determine the direction to
take with that line of products.
<PAGE>
GEORGE RISK INDUSTRIES, INC.
Part II. OTHER INFORMATION
Item 1. Legal Proceedings n/a
Item 2. Changes in Securities n/a
Item 3. Defaults upon Senior Securities n/a
Item 4. Submission of Matters to a Vote
of Securities n/a
Item 5. Other Information n/a
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibit 27. Financial Data Schedule
B. Reports on Form 8-K
No 8-K reports were filed during the
quarter ended January 31, 1998
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act,
the registrant caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
George Risk Industries, Inc.
(Registrant)
Date 02-18-98 Ken R. Risk
Ken R. Risk, Director
Date 02-18-98 Eileen M. Risk
Eileen M. Risk, Director
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> APR-30-1998
<PERIOD-START> MAY-01-1997
<PERIOD-END> JAN-31-1998
<CASH> 831
<SECURITIES> 4366
<RECEIVABLES> 1461
<ALLOWANCES> 50
<INVENTORY> 1580
<CURRENT-ASSETS> 8295
<PP&E> 1523
<DEPRECIATION> 843
<TOTAL-ASSETS> 9063
<CURRENT-LIABILITIES> 496
<BONDS> 0
<COMMON> 850
0
257
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 9063
<SALES> 8377
<TOTAL-REVENUES> 8377
<CGS> 4480
<TOTAL-COSTS> 4480
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 20
<INCOME-PRETAX> 2042
<INCOME-TAX> 783
<INCOME-CONTINUING> 1259
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1259
<EPS-PRIMARY> .21
<EPS-DILUTED> .21
</TABLE>
